Simon v. Canada (Attorney General)

Simon v. Canada (Attorney General)
Court (s) Database
Federal Court Decisions
Date
2013-11-04
Neutral citation
2013 FC 1117
File numbers
T-1649-11
Notes
A correction was made on February 12, 2014
Decision Content
Date: 20131104
Docket:
T-1649-11
Citation: 2013 FC 1117
Ottawa, Ontario, November 4, 2013
PRESENT: The Honourable Mr. Justice Scott
BETWEEN:
CHIEF JESSE JOHN SIMON AND COUNCILLORS FOSTER NOWLEN AUGUSTINE, STEPHEN PETER AUGUSTINE, ROBERT LEO FRANCIS, MARY LAURA LEVI, ROBERT LLOYD LEVY, JOSEPH DWAYNE MILLIEA, JOSEPH JAMES LUCKIE TYRONE MILLIER, MARY-JANE MILLIER, JOSEPH DARRELL SIMON, ARREN JAMES SOCK, JONATHAN CRAIG SOCK AND MARVIN JOSEPH SOCK ON BEHALF OF THEMSELVES AND THE MEMBERS OF THE ELSIPOGTOG FIRST NATION, AND ON BEHALF OF THE MI’GMAG FIRST NATIONS OF NEW BRUNSWICK, AND ON BEHALF OF THE MEMBERS OF MI’GMAG FIRST NATIONS OF NEW BRUNSWICK
CHIEF STEWART PAUL AND COUNCILORS GERALD BEAR, DARRAH BEAVER, EDWIN BERNARD, ELDON BERNARD, BRENDA HAFKE-PERLEY, TIM NICHOLAS, KIM PERLEY, ROSS PERLEY, THERESA (HART) PERLEY, TINA PERLEY-MARTIN, PAUL PYRES AND LAURA (LARA) SAPPIER ON BEHALF OF THEMSELVES AND THE MEMBERS OF TOBIQUE FIRST NATION AND ON BEHALF OF THE MALISEET FIRST NATIONS OF KINGSCLEAR, OROMOCTO AND WOODSTOCK AND THE MEMBERS OF THE MALISEET FIRST NATIONS OF KINGSCLEAR, OROMOCTO AND WOODSTOCK
CHIEF LEROY DENNY AND COUNCILORS BERTRAM (MUIN) BERNARD, LEON CHARLES DENNY, OLIVER JR. (SAPPY) DENNY, BARRY C. FRANCIS, GERALD ROBERT FRANCIS, ELDON GOULD, ALLAN WAYNE JEDDORE, DEREK ROBERT JOHNSON, KIMBERLY ANN MARSHALL, BRENDON JOSEPH POULETTE, JOHN FRANK TONEY AND CHARLES BLAISE YOUNG ON BEHALF OF THEMSELVES AND THE MEMBERS OF ESKASONI FIRST NATION AND ON BEHALF OF THE MI’KMAQ FIRST NATIONS OF ACADIA, ANNAPOLIS VALLEY, BEAR RIVER, GLOOSCAP, MILLBROOK, PAQTNKEK, PICTOU LANDING, POTLOTEK, SHUBENACADIE, WAGMATCOOK AND WAYCOBAH AND THE MEMBERS OF MI’KMAQ FIRST NATIONS OF ACADIA, ANNAPOLIS VALLEY, BEAR RIVER, GLOOSCAP, MILLBROOK, PAQTNKEK, PICTOU LANDING, POTLOTEK, SHUBENACADIE, WAGMATCOOK AND WAYCOBAH
CHIEF BRIAN FRANCIS AND COUNCILORS DANNY LEVI AND DAREN KNOCKWOOD ON BEHALF OF THEMSELVES AND THE MEMBERS OF ABEGWEIT FIRST NATIONS
Applicants
and
THE ATTORNEY GENERAL OF CANADA
Respondent
REASONS FOR JUDGMENT AND JUDGMENT
I. Introduction
[1] The Applicants are seeking judicial review of a decision made by the Minister of Aboriginal Affairs and Northern Development Canada (the Minister), in the spring of 2011(“the Decision”), changing the “reasonably comparable” approach to the assistance rates and eligibility criteria in the Income Assistance Program to apply a requirement of strict compliance with provincial assistance rates and eligibility criteria on the grounds that such change:
a) is an unconstitutional abandonment or sub-delegation to the provinces of the federal government’s power under subsection 91(24) of the Constitution Act, 1867 (UK), 30 & 31 Vict, c 3, s 91, reprinted in RSC 1985, App II, No 5 [Constitution Act, 1867] and will unconstitutionally bind its citizens by the laws of another government without specific enabling legislation;
b) was made without an opportunity for meaningful consultation, thus failing to meet the obligations of the Crown which flow from its sui generis relationship with the Aboriginal peoples of Canada, from the honour of the Crown, and from international instruments;
c) fails to meet the requirements of procedural fairness in accordance with the doctrine of legitimate expectations arising from the past history of dealings between the Crown and the Applicants (Amended Notice of Application, Joint Application Record [JAR], volume 2, p 379-380).
[2] For the reasons that follow, this application for judicial review is allowed.
II. The Parties
A. The Applicants
[3] The Applicants represent the Band Councils and membership of twenty six (26) Maritime and Maliseet “bands” as defined under the Indian Act, RSC 1985, c I-5 [Indian Act].The representative Applicants are the following:
a) the Elsipogtog First Nation represents itself and eight other Mi’gmag First Nations communities located in New Brunswick;
b) the Tobique First Nation represents itself and three other Maliseet First Nations communities located in New Brunswick;
c) the Eskasoni First Nation represents itself and eleven other Mi’kmaq First Nations communities in Nova Scotia;
d) the Abegweit First Nation represents itself, one of the two First Nations communities in Prince Edward Island;
e) the four First Nations who were added to these proceedings by order of Justice Mary Gleason dated September 21, 2012.
B. The Respondent
The Attorney general of Canada
III. The facts
[4] The Government of Canada provides essential services and programs to “Indians” residing on “reserves” (as these terms are defined under the Indian Act). There is no specific federal legislation regulating the provision of these essential services and programs.
[5] In the 1960’s the Department of Indian Affairs and Northern Development [DIAND], now recently renamed Aboriginal Affairs and Northern Development Canada [AANDC], identified a gap in the provision of income assistance to First Nations. The solution proposed by AANDC and approved by cabinet was the adoption of provincial and local municipal rates for food and clothing, fuel, household equipment, public utilities such as water and electricity, rent, as may be applicable.
[6] In 1964, the Treasury Board forwarded a letter to the Deputy Minister of Citizenship and Immigration (Indian Affairs Branch) approving funding to what is now AANDC, to administer relief assistance for First Nations in accordance with provincial or local municipal standards and procedures in force where reserves are situated (the “Directive”).
[7] In 1967, AANDC implemented the Directive through the development of regional manuals, all the while attempting to negotiate cost-sharing agreements with the provinces under Part II of the Canada Assistance Plan, SC 1966, c 45 [repealed SC 1995, c 17, ss 31-32] entitled “Indian Welfare”. Only one agreement for the provision of provincial welfare to Indians on reserves was successfully negotiated and it was with the Province of Ontario.
[8] AANDC directly administered the provision of essential services to First Nations up until the late 1970’s.
[9] By the 1980’s, as a result of federal policy being directed towards self-government negotiations, AANDC began entering into agreements with First Nations communities that allowed them to administer the Income Assistance Program to their members. These agreements were funded on an actual expense basis and are now referred to as Comprehensive Funding Agreements [CFAs]. The role of AANDC staff was to ensure, through regular accountability and compliance reviews, as well as audits, that the appropriate eligibility criteria and rates were being applied.
[10] In June 1986, the Treasury Board adopted the Increased Ministerial Authority and Accountability [IMAA] policy and, soon after, an IMAA Memorandum of Understanding [MOU] between the Treasury Board and DIAND at the time (now AANDC) was signed. The MOU described the parameters within which AANDC could spend its appropriated funds. Like the Directive it replaced, the MOU requires AANDC’s income assistance programs to apply the qualifying requirements and assistance schedules as the general assistance program of the province or territory in which it is administered. The pertinent sections of the MOU provide as follows:
“A.2 Delegation of Authorities: Constraints
As a result of the decision of TB Ministers to implement IMAA, DIAND enjoys broad discretion to reallocate resources (financial and person-year) within existing appropriations, provided that such reallocations:
- respect the mandate of the department;
- are consistent with government-wide policies and objectives established by Treasury Board and Cabinet;
- do not draw funds away from capital investment;
- can be funded in future years within approved reference levels; and
- do not increase the size or the wage bill of the public service.
DIAND is expected to live within approved resources which may be adjusted through the Multi-Year Operational Plan (MYOP) to address new policy initiatives, extraordinary workloads, and price increases required to fund programs such as elementary-secondary education delivered by provincial governments. It is understood that while the department may reallocate funds which are surplus to services involving basic needs it will not request any supplementary funding for its basic needs programs beyond those funds approved in its MYOP.
…
B.3 Administrative Accountabilities
The DIAND accountability framework for TB policies dated July 13, 1990, is held by the TBS and departmental spokespersons named in Section B.7 and defines, for key TB policies:
- policy objectives;
- performance targets/results expected;
- performance indicators;
- reporting requirements; and/or
- the basis on which TB will monitor performance.
…
C.3 Social Development Activity (IIAP)
…
I) Social assistance. The department funds social assistance in accordance with the service standard and method of program delivery as outlined below:
- Service Standard. For each province and the Yukon Territory, the Social Assistance Program must adopt the qualifying requirements and assistance schedules of the general assistance program of the province or territory. The level of benefits provided are [sic] adjusted to reflect the services and benefits provided to Indian people through other federal programs, e.g. the Indian Housing Program and Non-Insured Health Benefits.
…
Funding for social assistance services is provided by the department for the following items, but not limited to:
- Financial Assistance. Funds for income support payments for eligible recipients consistent with the assistance schedules of the provincial/territorial general assistance program; and
- Service Delivery. Funds provided for the provision of services to qualified applicants.
- Method of Program Delivery. While the department may directly administer the social assistance to qualified applicants, it may be alternatively delivered by bands or district/tribal councils. The department is authorized to enter into and amend agreements/arrangements with the bands or district/tribal councils which deliver the program.
In the case of the Province of Ontario, the department compensates the province for social assistance provided to Indians with reserve status. The payments are made in accordance with the provisions of the Memorandum of Agreement Respecting Welfare Programs for Indians between the Government of Canada and the Government of Ontario of 1965 and as subsequently amended.
- Related Social Assistance Authorities. The department currently has Treasury Board authority related to the use of the social assistance entitlements of participants in employment and training projects. The authorities listed below remain in effect:
- Work Opportunity Program – TB 705360 and 711118
- Indian Community Human Resources Strategies – TB 808548
…
Annex I: Program Performance Frameworks
The enhanced ministerial accountability in the area of program delivery that is being provided through the IMAA Memorandum of Understanding consists of program performance frameworks for four key areas of the department and an outline of the proposed development of performance frameworks for the other significant areas of the department.
The four completed program performance frameworks are for the following activities:
- Education
- Social Development
- Capital Management
- Administration
Expenditures on those activities constitute 80% of total expenditures of the Indian and Inuit Affairs Program, the Northern Affairs Program and the Administration Program. The frameworks include the overall activity objective, sub-objectives, related results, performance indicators and details on reporting and targets. Also, some of the frameworks include commitments to make specific management improvements.
In the first Annual Management Report (AMR) there will be reporting against the various indicators which follow. Targets for these indicators will be established in the first AMR so that in the second AMR there will be reporting against these targets. In order to provide sound data to the Treasury Board and to improve policy development, the department is enhancing the quality and extent of
information through such initiatives as the required post-censal survey of aboriginal persons.
. . .
Social Development: Program Performance Framework
General: The Social Development activity consists of three major programs: Social assistance, Indian child and family services, and adult care.
Social Assistance: The objective of the social assistance program is to ensure that eligible Indians receive the same level of social assistance benefits as other provincial residents and to reduce Indian dependence on social assistance to the extent possible.
Sub-Objectives
Results
Indicators
Targets/Reporting
• Same level of benefits
• Fair treatment of eligible on-reserve Indians who will receive benefits comparable to those available to other Canadians
• Percentage of social assistance funds under bank or departmental administration that have been correctly administered
• Develop systems and targets for AMR June 1991. Report against targets June 1992 and subsequent years
• Reduced dependency rate
• Greater self-reliance
• Percentage of social assistance budget transferred under existing authorities to provide training and development to eligible individuals
• This indicator will not be targeted because it is subject to many uncontrollable influences. The indicator will be reported in all AMRs
Evaluation: An evaluation of the longer term impacts of the social assistance transfer authority will be reported on in the AMR June 1993 or in a previous AMR.
[11] The MOU also provided AANDC with the flexibility to enter into Alternative Funding Agreements [AFAs]. Unlike CFAs, AFAs are multi-year agreements under which First Nations receive a block of funding. AFAs also allowed First Nations to apply any unused or surplus funds in one program and transfer them to another approved program. Under CFAs, First Nations are required to return any surplus funds to AANDC. First Nations that qualify for funding, but do not qualify for an AFA, may enter into a one-year CFA.
[12] Since 1991, AANDC has provided regional and national program manuals. These identified policy priorities and set the rates and eligibility criteria for income assistance on reserves. Some First Nations have developed their own policy manuals.
[13] In 1991, AANDC developed a regional manual called the Atlantic Office Social Assistance Manual for New Brunswick (the 1991 Manual). That Manual did specify that First Nations had to administer income assistance at provincial rates and standards but, contrary to the Directive, the suggested rates were not identical to those in the provinces (see Susan Brown affidavit, JAR, volume 2, tab 4, paras 41-46 and Dougal MacDonald cross-examination, JAR, volume 7, pp 2483 and 2484).
[14] Aside from a rate change in 1994, the policy priorities, rates and eligibility criteria for income assistance outlined in the 1991 Manual have remained the same.
[15] Prior to the completion of the 1991 Manual, AANDC received comments from First Nations in New Brunswick. In April 1990, the Elsipogtog First Nation sent a report to AANDC containing their comments and concerns on the draft 1991 Manual. The Elsipogtog had concerns regarding AANDC’s decision to adopt and follow the rates and conditions established by the New Brunswick government.
[16] In 1994, the Elsipogtog developed its own community manual, called the Etpiiteneoei Program –Supports to Personal, Family and Community Development (the “Etpiiteneoei Manual”), which First Nations felt better reflected the social reality of life on their reserve than the regional manual. The Etpiiteneoei Manual and the 1991 Manual differ primarily in their criteria for determining eligibility for income assistance. The Elsipogtog have been applying the Etpiiteneoei Manual since at least 1999 (and possibly as early as 1994). The parties disagree over whether AANDC ever authorized the Elsipogtog to use the Etpiiteneoei Manual in administering income assistance on their reserve.
[17] AANDC did not conduct any compliance reviews on First Nations under AFAs between 1991 and 2008.
[18] In or around 2004, AANDC developed a national manual entitled “Income Assistance- National Standards and Guidelines Manual” (the “National Manual”), with the goal of establishing national standards to guide the development of regional policies. A draft of the National Manual dated February 16, 2004 specifies, at section 1.5, that, as a general principle, income assistance would be delivered at standards reasonably comparable to those applied in the province or territory where the reserve is located.
[19] Additional national manuals were published in July 2006 and January 2007. Under the heading “Roles and Responsibilities”, in section 1.5.5., both manuals retained the principle of reasonable comparability as stated in the 2004 version that is:
“. . . delivery of income assistance at standards reasonably comparable to the reference province or territory of residence” (see JAR, volume 3, p 873).
[20] A draft Atlantic Region Social Programs Manual (the “Atlantic Manual”) dealing with income assistance as well as other social programs on-reserve in the Atlantic Region was completed and circulated to AANDC’s Regional Operations and Program Committee at its June 2011 meeting. This new manual did not refer to reasonable comparability but instead mandated strict adherence or mirror-like compliance with provincial rates and standards. It stated that “[t]he Income Assistance program on a reserve is administered using the same rate structure and eligibility criteria as the parallel program administered by the province for off reserve residents” (see JAR, volume 5, p 1844). It also specified that “[b]asic needs rates should follow the standards and rate schedules of the province” (see JAR, volume 5, p 1852). In January 2012, AANDC gave notice that this Manual would not be implemented and would be replaced by a revised National Manual (the “National Manual (2012)”).
[21] According to Dougal MacDonald, the Assistant Director General of AANDC for Atlantic Canada, the National Manual (2012) replaced the draft Atlantic Manual. The Chiefs and Councillors of Atlantic Canada received a copy of that latest version of the National Manual (2012) in view of their attendance at an Aboriginal Affairs “How To” Workshop. It is important to note the wording retained in the National Manual (2012). It reads as follows:
“1.0 Main Objective and Program Description
1.1 The purpose of the IA program , as a last means, is to:
• support the basic and special needs of indigent residents of Indian reserves and their dependants; and
• support access to services to help clients transition to and remain in the workforce.
1.2 The objective of the program is to provide funding so that:
• basic needs for food, clothing and shelter are met;
• employment and pre-employment support is provided;
• special needs allowances are available for goods and services essential to the physical or social well-being of a client;
• programs will be delivered at standards reasonably comparable to those of the reference province/territory of residence; and (emphasis added)
• amounts payable for income assistance will be equivalent to the rates of the reference province or territory”. (see JAR, volume 2, p 416)
[22] The manual explains that the “amounts payable for income assistance will be equivalent to the rates of the reference province or territory”. The National Manual (2012) thus mandates a mirroring of provincial rates but retains the reasonably comparable criteria in respect of eligibility. It is important to note that the National Manual (2012) does specify, at page 16, that a client must demonstrate that he is eligible for basic or special financial assistance (as “defined by the province or territory of residence”) (see JAR, volume 2, p 418, section 3.1). Consequently it is a strict application of provincial eligibility criteria.
[23] The National Manual (2012) contains only 4 pages on AANDC’s Income Assistance Program on-reserve. AANDC informed participants at the mid-February 2012 “How-to” meeting that First Nations in New Brunswick would have to apply New Brunswick’s Social Assistance Manual.
IV. The issues and the standard of review
A. The issues
[24] The Applicants have suggested the following issues for review:
1. Is the Decision constitutional on division of powers principles?
2. Does the Decision fetter, or otherwise constitute an abuse of the Minister’s discretion?
3. Does the Decision breach the Applicants’ rights to procedural fairness?
[25] The Respondent on the other hand casts the points in issue as follows:
1. Are the Crown’s funding decisions subject to judicial review?
2. The Minister did not delegate his powers.
3. Even if the Decision can be reviewed, the evidence does not support the Applicants’ claim.
4. The Minister did not breach procedural fairness in the course of making his decision.
5. The Minister’s implementation of his funding authority does not engage either the honour of the Crown or a duty to consult.
[26] The Court, however, concludes that the following issues are determinative of this application:
1. Does the Minister’s Decision to have rates and eligibility requirements applicable to funding of income assistance on reserves mirror those provided by the province conform to the Treasury Board’s MOU?
2. Did the Minister breach the Applicants’ right to procedural fairness?
B. The standard of review
[27] It is clear that the Decision is subject to judicial review for compliance with the Constitution Act, 1867. The Respondent argues that this Court cannot review the Minister’s decision on principles of administrative law as it is a funding decision at its core and would consequently engage the Court in political decision-making on how the Crown should be exercising its spending power. The Court disagrees in the present instance for the following reasons.
[28] Professor David J. Mullan defines administrative law and the relationship between courts and the administrative process in the following manner:
“[…] Administrative law is … the body of law that establishes or describes the legal parameters of powers that exist by virtue of statute or residual Royal prerogative. … [A]dministrative law embodies the principles by which the courts supervise the functioning of persons and bodies that derive their powers from either statute or the Royal prerogative” (David J. Mullan, Administrative Law, (Toronto: Irwin Law, 2001) at 3).
[29] The guiding principle behind the above definition is the respect for the division of powers between the executive, legislative and judicial branches of our constitutional democracy. As Justice Barnes found in Friends of the Earth v Canada (Governor in Council), 2008 FC 1183 at para 25:
“One of the guiding principles of justiciability is that all of the branches of government must be sensitive to the separation of function within Canada’s constitutional matrix so as not to inappropriately intrude into the spheres reserved to the other branches: see Doucet-Boudreau v. Nova Scotia (Minister of Education), 2003 SCC 62, [2003] 3 S.C.R. 3, at paragraphs 33 to 36 and Canadian Union Public Employees v. Canada (Minister of Health) 2004 FC 1334, (2004), 244 D.L.R. (4th) 175 (F.C.), at paragraph 39. Generally a court will not involve itself in the review of the actions or decisions of the executive or legislative branches where the subject matter of the dispute is either inappropriate for judicial involvement or where the court lacks the capacity to properly resolved [sic] it.”
[30] Paragraph 4(a) of the DIAND Act provides that “[t]he powers, duties and functions of the Minister extend to and include all matters over which Parliament has jurisdiction, not by law assigned to any other department, board or agency of the Government of Canada, relating to (a) Indian affairs; […]”. Were this the only statute prescribing the Minister’s powers relative to income assistance funding for First Nations, it would be difficult for the Court to intervene. The Decision would truly be an example of a government (i.e. executive) decision motivated by, in this case, government policy. Such decisions are generally final and not reviewable on administrative law principles (see Thorne's Hardware Ltd v The Queen, [1983] 1 SCR 106 [Thorne's Hardware] at p 111; Masse, cited above, at para 214).
[31] Judicial review on grounds of an abuse of ministerial discretion is difficult in the case at bar because such review is limited to 1) decisions that are contrary or inconsistent with the purpose of the discretion-granting statute; 2) decisions that are so unreasonable that they amount to an absence of good faith (see Conseil des Innus de Ekuanitshit v Canada (Attorney General), 2013 FC 418 at para 76).
[32] The DIAND Act is of little assistance in the present case because the statute is not specific to income assistance for First Nations and thus offers no specific purpose against which to assess the Decision. Indeed, the DIAND Act is limited in scope, as we have stated, since it confines the Minister’s powers, duties and functions related to AANDC as those over which Parliament has jurisdiction and not handed over to another department board or agency of the Government of Canada. As noted above, the Parliament of Canada has legislative authority regarding Indians by virtue of subsection 91(24) of the Constitution Act, 1867. Parliament has yet to adopt specific legislation governing income assistance to First Nations.
[33] Because the Decision involves the expenditure of public monies, however, the Minister’s actions are circumscribed by the provisions of the Financial Administration Act, RSC 1985, c F-11 [FAA] and by the legal and regulatory requirements relating to Crown expenditures and contracts (e.g. the annual Appropriation Acts). Whether the Decision is in compliance with the FAA is clearly subject to judicial review (see Larocque v Canada (Minister of Fisheries and Oceans), 2006 FCA 237 [Larocque]). Less obvious, though, is whether the Decision is reviewable on the basis that it does not comply with the Treasury Board’s Directive, MOU or Policy on Transfer Payments.
[34] In Endicott v Canada (Treasury Board), 2005 FC 253 [Endicott] at para 11, Justice Strayer concluded that the question as to whether Treasury Board “directives create legal rights which a court can define or enforce, appears from the jurisprudence to depend on what the intent was and the context in which the directive was issued”.
[35] According to the Respondent, the Treasury Board’s MOU “was an exercise of [its] legal authority over the financial management of the funds [under paragraph 7(1)(c) of the FAA] and constituted a constraint on the Minister’s authority to spend such funds” (Respondent’s Memorandum, para 17). The Court agrees. Given that Parliament has refrained from legislating in the area of income assistance to First Nations, the Treasury Board’s Directive, MOU and Policy on Transfer Payments are the only documents which express Parliament’s purpose or goal in providing funds for income assistance on reserves. In that sense, they represent a kind of legislative decision- making that binds the Minister’s discretion over the expenditure of funds authorized for that purpose. They are, in this Court’s view more than simple guidelines for the expenditure of funds and the efficient management of the income assistance program since they also set out criteria against which these funds can be expended and results to be attained (see MOU).
[36] Both parties acknowledge that the Treasury Board, via its Directive, MOU and Policy on Transfer Payments, granted AANDC funding authority to administer income assistance programs at rates and standards “comparable” to those offered by the provinces. The only significant point of contention between the parties is the extent to which the National Manual (2012) imposes rates and eligibility requirements that are “comparable” to those offered in the referenced Provinces. In other words, the correct interpretation of the word “comparable” is at issue.
[37] The applicable standard of review for the interpretation of Treasury Board directives was considered by Justice Evans in Assh v Canada (Attorney General), 2006 FCA 358, at para 40, and was determined to be that of correctness. This Court also referred to Endicott, cited above, which related to the grievance board’s interpretation of wording used in a Treasury Board Policy and for which the Court determined that the appropriate standard of review was correctness (see Endicott, cited above, at para 9). It could be argued, however, that the appropriate standard now is that of reasonableness, since, as was stated in Dunsmuir v New Brunswick, [2008] 1 SCR 190 at para 54 [Dunsmuir], where the tribunal is interpreting its own statute or statutes closely related to its function with which it will have particular familiarity then the standard is normally that of reasonableness. The case of Alberta (Information and Privacy commissioner) v Alberta Teacher’s Association, 2011 SCC 61 at para 34 reinforced this statement :
“[U]nless the situation is exceptional, and we have not seen such a situation since Dunsmuir, the interpretation by the tribunal of ‘its own statute or statutes closely connected to its function, with which it will have particular familiarity’ should be presumed to be a question of statutory interpretation subject to deference on judicial review”.
[38] Since all government departments are subject to the FAA, cited above, and to the Appropriation Acts, these statutes can be viewed as closely connected to their functions. The Minister’s authority to make the expenditures related to income assistance for First Nations recipients is circumscribed by the MOU, the FAA .and the Appropriation Acts. Consequently, it is this Court's view that the reasonableness standard of review should apply in this instance as it reviews the first issue.
[39] This Court concludes that it has the appropriate authority to review the Minister’s Decision to interpret the meaning of the words “adopt”, “comparable” and “consistent with”, in the MOU, as meaning to mirror provincial rates. Contrary to the Respondent’s argument it is not the Minister’s spending authority which is being reviewed but his interpretation of the criteria applicable to spending under that authority and whether that interpretation will result in the attainment of the objectives set by the MOU with respect to the Income Assistance Program.
[40] As to the second issue, i.e. procedural fairness, the appropriate standard of review is correctness (see Canadian Union of Public Employees (C.U.P.E.) v Ontario (Minister of Labour), [2003] 1 SCR 539 at para 100 and Canada (Minister of Citizenship and Immigration) v Khosa, 2009 SCC 12 at para 43).
V. The parties’ position
A. The Applicants’ position
[41] The Applicants present three main arguments in support of their conclusion that the Court must quash the Minister’s decision to impose the mirroring of provincial rates and eligibility criteria.
[42] The first proposition is rooted in constitutional law. The Applicants submit that it is unconstitutional for one level of government to bind its citizens to the laws of another government, in this case the provincial laws on welfare. They cite a Supreme Court decision, Reference re: Anti-Inflation Act (Canada), [1976] 2 SCR 373 [Reference re: Anti-Inflation Act] and cite Justice Laskin, at paragraph 89, for the proposition that the Minister of Indian Affairs does not have the authority to bind First Nations under Canada’s subsection 91(24) jurisdiction to laws not enacted by Parliament nor made applicable to First Nations by authorizing legislation.
[43] The second argument brought forth by the Applicants is to the effect that the Minister’s decision to impose mirror provincial rates on First Nations reserves in the Maritimes is so flawed that it constitutes an abuse of discretion because it was made in the absence of proper consultation and without consideration of its impacts on recipients.
[44] The Applicants submit that AANDC does not know the full impact of the decision and failed to assess its repercussions on current recipients. They point, firstly, to the administrative chaos and the increased likelihood of non-compliance that will result from the implementation of the National Manual (2012) since First Nations social workers are now required to access the applicable provincial social manual online. The Applicants also indicate that the current computer systems used by several First Nations are not compatible with provincial assistance data systems (see JAR, volume 2, tab 6, paras 16 to 28 and paras 66 to 73, Affidavit of Susan Brown).
[45] The second issue raised by the Applicants pertains to the changes in eligibility criteria as a result of moving from a reasonably comparable approach that was embodied in the 1991 Atlantic Manual to a strict adherence to provincial standards mandated by AANDC. Their main contention on that point is that several types of income which are not currently calculated into a recipient’s gross income will now be calculated under provincial rules, thereby rendering several recipients non-eligible. In Nova Scotia, certain benefits for seniors will no longer be allowed, similarly, the criteria for youth eligibility will change from 18 to 19 years of age (see Dr. Wien’s presentation dated April 24, 2011, JAR, volume 8, tab K, p 2758).
[46] The Applicants also claim that there exists a lack of comparability between provincial regimes and the needs of First Nations communities in Atlantic Canada. In view of the imposition of a strict adherence to the basic assistance rates and special needs as defined by the applicable provincial manuals, it is the Applicants’ contention that provincial subsidies and programs, which are complementary to these schemes, will not be accessible to First Nations recipients and therefore create a significant disparity. They invoke a letter sent by the assembly of First Chiefs in New Brunswick to the Minister of AANDC in April 2011 identifying 29 programs in New Brunswick that supplement the basic rate of welfare recipients in that province that are not accessible to First Nations recipients living on reserves. A similar concern exists in relation to complementary social benefit programs in Nova Scotia (see JAR, volume 1, tab 2, p 89). The list of programs identified in New Brunswick is the following:
“Affordable Housing Program Subsidies
Daycare Assistance Program
Disability Support Program
Emergency Fuel Benefit
Energy Efficiency Retrofit Program
Fuel Supplement
Federal/Provincial Repair Program
Health Services – Allergy Serum Program
Health Services –Convalescence and Rehabilitation Program
Health Services –Dental Program
Health Services –Enhanced Dental Program
Health Services –Hearing Aid Program
Health Services –Hyperalimentation Program
Health Services –Orthopedic Program
Health Services –Ostomy Program
Health Services –Out-of-Province Medical Program
Health Services –Oxygen and Breathing Support Program
Health Services –Prosthetics Program
Health Services –Vision Care Program
Health Services –Wheelchair and Mobility Support Program
Home Heating Supplement
Home Completion Loan Program
Home Ownership Support Program
Housing Assistance for Persons with Disabilities
Long-Term Care Subsidies
Prenatal Benefits Program
Postnatal Benefits Program
Rent Supplement Assistance Program
Seniors with Low Income Benefit”
[47] The fourth problem identified by the Applicants is the lack of shelter supplement and its impact on the Canada Mortgage and Housing Corporation [CMHC] low-income housing loans. As the Applicants explain:
“Most social assistance recipients on reserve live in Band-owned housing financed under loan agreements between the First Nation and Canada Mortgage and Housing (“CMHC”), pursuant to s. 95 of the National Housing Act, RSC 1985, c N-11. Pursuant to these agreements, the loans from CMHC to build each home are to be repaid through the occupiers’ social assistance payments. CMHC loan repayments can be in the range of $500-600 per month on reserves in New Brunswick. …. Therefore, if a person on reserve is receiving New Brunswick’s basic Schedule B amount of $827, after paying their rent, the individual will be left with only $200-300 for utilities, food, transport, and personal need items for the entire month” (Applicants’ Memorandum, para 55).
[48] The Applicants equally allege that a similar problem will exist in Nova Scotia. They referred the Court to Dr. Wien’s presentation, a consultant hired by the joint committee, and more particularly to his comparison between what a single adult currently receives and what he would be receiving as a result of a strict mirroring of provincial rates.
Component
Presently receiving on reserve (monthly)
Would receive under provincial (monthly)
Basic assistance
209.70
229.00
Supplement for household
108.60
-
Shelter
620
Electricity
Tbd
Heat
373.00
Mortgage
411.00
Benefits for 2 children ages 5 and 7
276.60
TOTAL
$1,378.90
$849
[49] The Applicants identified two other areas in New Brunswick where the strict application of provincial rates would create significant difficulties. These are the reduction in utilities supplement and the reduction in funding for special diet supplements.
[50] The Applicants equally contend that welfare recipients in Nova Scotia will no longer be able to keep the National Child Benefit which represents approximately $56-$84 every second week (see Dr. Wien’s presentation, JAR, volume 8, tab 18, para 38).
[51] The Applicants submit that AANDC acknowledges that the Decision to mirror provincial rates and eligibility criteria is not impact-neutral but emphasizes that First Nations will be receiving the same amount of money under their respective funding agreements and can therefore supplement deficiencies, and demise new programs to alleviate these shortfalls. The Applicants take exception to this point of view and allege that the wording in the new agreements does not necessarily provide the flexibility to adequately compensate any shortfall.
[52] In view of the fact that the Government of Canada has chosen not to legislate the provision of services to First Nations, the Applicants submit that the discretionary nature of the Decision should not shelter it from judicial review. Indians on reserves should be entitled to the same rights in terms of their access to judicial review as other Canadians, notwithstanding the fact that the Minister’s decision is discretionary since there is no statutory framework imposing boundaries on the Minister with respect to the provision of welfare services to First Nations.
[53] The Applicants also look to Canada’s commitment in article 5 of the Social Union Framework Agreement [SUFA] and Canada’s endorsement of the United Nations Declaration on the Rights of Indigenous Peoples [UNDRIP], more specifically articles 19, 21 and 43 to argue that both instruments reflect values and principles that should have guided the Minister in his decision making.
[54] The Applicants also argue that the honour of the Crown is at stake in all dealings between Canada and its Aboriginal peoples (Mushkegowuk Council v Ontario, [1999] OJ No 3170 [Mushkegowuk]; Haida Nation v British Columbia (Minister of Forests), [2004] 3 SCR 511 [Haida] and Taku River Tlingit First Nation v British Columbia (Project Assessment Director), 2004 SCC 74 [Taku River]).
[55] Turning to the Supreme